Companies Ready Their Responses Based on Three Potential Outcomes; Some Already Have Made News

The Supreme Court decision on the fate of President Barack Obama's Affordable Care Act, scheduled to be announced at the end of this month, has insurers scrambling to prepare messaging for three potential outcomes: the law is upheld; the law is overturned; or parts of the law, such as the individual mandate that everyone must purchase insurance, are overturned.

Since 2010, when the health-reform bill became law, insurance companies have been boosting their consumer-facing marketing efforts to prepare for an environment in which everyone has access to health care regardless of pre-existing conditions and is forced to purchase insurance. According to Atlantic Information Services, Aetna, Cigna, UnitedHealthcare, Wellpoint and Humana alone spent a collective $366.8 million on advertising in 2011, up 51.6% from 2010. The report references data from AIS's Health Plan Week and Kantar Media.

No matter what happens, insurers will continue to invest in consumer-oriented products and preventive-wellness programs focused on keeping medical costs low. But the ruling will still have a profound effect on business models and marketing messages supporting those hundreds of millions in advertising dollars.

If the law is overturned, insurers will revert to many of the old rules, such as choosing their own customer base. But they'll likely continue to communicate the kinds of messages we saw last week from Aetna, Humana and United. The for-profit insurance companies got out in front of the Supreme Court ruling: Regardless of the decision, they said, they would continue to implement more consumer-friendly elements from the reform law, such as allowing kids under the age of 26 to stay on parents' plans and keeping prevention and wellness a priority.

If the law is overturned, big insurers that focus on niche markets will also tailor messaging to fit consumers affected by the ruling. For example, a company that targets the Medicare community might educate consumers about how drug coverage is affected, said Lindsay Resnick, chief marketing officer of KBM Group, a WPP direct-marketing health group. The reform closes the gap in Medicare drug coverage known as the doughnut hole. If the law is overturned, he said, the hole remains. So an insurer might say something like: "We'll help our Medicare Part D customers through that , and we'll push for legislation that extends Accountable Care Organizations. We believe in having providers partake in some portion of the risk."

If the entire law is upheld, the three insurers who pledged to keep elements of the reform law -- Aetna, Humana and United -- will likely issue reminders that they would have had consumers' backs had the law been overturned. Although they caught some flak for not pledging to carry out the most dramatic elements of reform, such as selling to consumers with pre-existing conditions, industry execs agreed that their proactive messaging was a smooth PR play.

The third scenario could throw out one or two major pieces of the reform law, such as the mandate that all individuals must purchase insurance, but uphold other elements of the law, such as mandates for state-run exchanges where consumers can purchase insurance directly from a web platform.

In this partial-reform scenario, companies are likely to create messages around how to help people with pre-existing conditions get some form of insurance. They might tout an expanded plan portfolio and increase promotion of existing "catastrophic plans," which have low premiums and can only be used for, well, catastrophic events.

"They'll use it as an opportunity to say that "Even though it's not mandated, we'll make our products more accessible to you,'" said Mr. Resnick.

This scenario has driven some companies to nearly double their research and PR budgets during the past six months, according to executives speaking on the condition of anonymity.

If only the mandate is thrown out, there will be "a very intensive targeted effort aimed at policy, stakeholders and opinion leaders," said Mike Tuffin, who recently left his post at the Association of Health Insurance Plans and is set to join APCO this week.

But companies will need to balance policy pushes with consumer messages, he said. The policy message will point out the negative effects of eliminating the mandate, such as higher premiums, while the consumer message might "ensure that in this disruptive environment, their current customers can still count on coverage," Mr. Tuffin said.

Insurance companies are complying with AHIP's agenda to create a unified message, said numerous executives. They're also in line on another front: being judicious about what they say.

A PR executive who worked at an insurance company said, "There have been a number of cases, especially since the Medicare Modernization Act, where insurance companies have run afoul of one piece of government or another based on messaging, and it's made them very cautious."

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Alexandra Bruell

Alexandra bruell is the lead agency reporter at Advertising Age. She specializes in coverage of digital, media buying & planning and PR. Prior to joining Ad Age in May 2011, she was a senior reporter at PRWeek. Earlier in her career she worked at a small healthcare ad agency then called TheCementWorks. She earned her BA at Tulane University.